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Julli [10]
3 years ago
7

Mountain Teas wants to raise $14.9 million to open a new production facility. The company estimates the issue costs for legal an

d accounting fees will be $582,000. The underwriters have set the stock price at $27.50 a share and the underwriting spread at 8.15 percent. How many shares of stock must be sold to meet this cash need?
Business
1 answer:
ololo11 [35]3 years ago
8 0

Answer:

612,936 shares

Explanation:

The computation of the number of shares of stock must be sold is shown below:

Before that we have to compute

Required sales proceeds net of spread is

= (Raise amount + estimated cost for  legal and accounting fees) ÷ (1 - spread rate)

= ($14.9 million + $582,000) ÷ (1 - 0.0815)

= ($1,5482,000) ÷ (1 - 0.0815)

= $16,855,743.06

So, shares to be sold is

= $16,855,743.06 ÷ $27.50

= 612,936 shares

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In the Keynesian-cross model with a given MPC >0, the government-expenditure multiplier ______ the tax multiplier.
Slav-nsk [51]

Answer:

the government-expenditure multiplier _Is larger than_ the tax multiplier.

Is larger than

Explanation:

Keynesian Cross Model otherwise known as expenditure-output model is used to determine the point where total or aggregate expenditures in the economy are intercept the amount of output produced, i.e equilibrium level of real GDP. In economy, if MPC >0, the government-expenditure multiplier is larger than the tax multiplier.

5 0
3 years ago
Which statement is false about liquidity?
BARSIC [14]

Answer:

Option D. Both A and B

Explanation:

The reason is that the investment that are readily convertible to cash are less risk and as a result the investors are compensated with lower returns and vice versa. So the only statement that is not false statement is option C and the statement A and B are False.

8 0
3 years ago
. Fixed costs are costs that remain the same in total dollar amount as the activity base changes. vary with the costs of the act
Phoenix [80]

Fixed costs are costs that remain the same in total dollar amount as the activity base changes. vary with the costs of the activity. Read below on fixed costs.

<h3>What are fixed costs?</h3>

Fixed costs are costs that remain the same in total dollar amount as the activity base changes. Cost per unit changes inversely to changes in the activity base. Total cost remains the same regardless of changes in the activity base.

Therefore, the answer is option A. vary with the costs of the activity.

learn more about fixed costs: brainly.com/question/3636923

8 0
2 years ago
​Sustainable businesses tend to be run by CEOs who are:
Marianna [84]
The answer is Target-driven<span>
</span>
8 0
3 years ago
Acme Widget, Inc. has 1,000 shareholders who own a total of one million shares of its common stock. The company earned $10 milli
Dafna1 [17]

Answer:

$94 per share

Explanation:

Stockholders Equity Includes the Add-in-capital par value, Add-in-capital excess value of Common and Preferred, Net income accumulated value and dividends.

Equity of the firm = Assets - Liabilities

Equity of the firm  = $125 million - $25 million = $100 million

Net Addition in the equity = Net earning for the period - Dividend paid

Net Addition in the equity = $10 million - $4 million - $6 million

Book Value of the equity = Equity of the firm - Additions in the year

Book Value of the equity = $100 - $6 = $94 million

Book value per share = Book Value of the equity / Numbers of Share

Book value per share = $94 million / 1 million

Book value per share = $94 per share

8 0
3 years ago
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